Summary of Oil States International Conference Call Company Overview - **Company**: Oil States International (NYSE: OIS) - **Market Capitalization**: $372 million as of November 18, 2025 [5] - **Free Cash Flow Yield**: 19% on a trailing twelve months (TTM) basis, considered attractive relative to size and peer group [6] - **Backlog**: $399 million as of September 30, 2025, the highest since 2015 [17] Core Business Segments 1. **Offshore Manufactured Products** - Largest segment with global exposure to key oil and gas basins [9] - Expected revenue growth of 13%-18% sequentially in Q4 2025 [22] - Strong market position with Flex Joint connector technology, holding an 80%-85% market share [12] 2. **Completion and Production Services** - Focus on high-grading differentiated product lines, exiting commoditized lower-margin offerings [10][18] - Emphasis on offshore production services, particularly in the Middle East [19] 3. **Downhole Technologies** - Currently facing challenges due to reduced U.S. shale activity [20] - Strategy includes improving domestic technology offerings and expanding internationally, particularly in Brazil and the Middle East [21] Investment Considerations - **Growth Drivers**: - Global energy demand and offshore growth are key drivers for the company [8] - Focus on technology-driven solutions and organic growth [26] - **Financial Health**: - Projecting to achieve net debt zero by the end of 2025 [24] - Strong cash flow generation expected to exceed $100 million for the year [23] - **Valuation**: - Trading at 5.2 times valuation, perceived as low compared to technology-rich offerings [7][31] - Potential for share repurchases and consideration of dividends based on shareholder preferences [34] Strategic Focus - **International Expansion**: - Shift towards more offshore and international projects due to reduced competition and more predictable revenues compared to U.S. shale [27][29] - **Technology Development**: - Continuous innovation with new products like Managed Pressure Drilling Systems and low-impact workover riser packages [13][17] - Adaptation of legacy oil and gas technology for new energy markets, including offshore wind and carbon capture [16][33] Risks and Challenges - **Market Cyclicality**: - U.S. shale market characterized by short cycles, making it more volatile compared to offshore projects [28][30] - **Operational Adjustments**: - Transitioning out of lower-margin business lines may incur costs related to lease exits and facility closures [23] Conclusion - Oil States International is positioned for growth with a strong backlog, innovative technology, and a focus on international markets. The company aims to enhance shareholder value through strategic investments and share repurchases while navigating the challenges of the energy sector.

Core Insights - The article discusses the author's extensive experience in stock analysis, particularly in the energy sector, focusing on oilfield equipment services and industrial supply industries [1]. Group 1 - The author has over 14 years of experience in stock analysis, covering both long and short positions in an unbiased manner [1]. - The primary focus of the author's analysis has been on the energy sector for the past 7 years, specifically the oilfield equipment services sector [1]. - The author also covers the industrial supply industry, indicating a broad expertise in related sectors [1].

Core Insights - The oil price remains strong, driving exploration and production activities, which boosts demand for drilling and production equipment [1][4] - Companies in the Zacks Oil and Gas - Mechanical and Equipment industry are experiencing rising backlogs, indicating a positive outlook [5][7] Industry Overview - The Zacks Oil and Gas - Mechanical and Equipment industry includes companies that provide essential oilfield equipment such as production machinery, pumps, and valves to exploration and production firms [3] - The industry's performance is closely linked to the spending of upstream energy companies, which rely on these equipment providers for extracting crude oil and natural gas [3] Future Outlook - The U.S. Energy Information Administration (EIA) projects that the average spot price of West Texas Intermediate (WTI) crude will be $65.15 per barrel in 2025, supporting strong demand for industry equipment [4] - Companies are implementing decarbonization initiatives to reduce Scope 1 and 2 emissions, aligning with global sustainability goals and enhancing their attractiveness to environmentally conscious investors [6] Backlogs and Financial Health - The industry is characterized by significant backlogs, indicating a strong demand for equipment and the ability to secure high-value projects [5] - Key players like NOV Inc. (NOV), Oil States International Inc. (OIS), and Natural Gas Services Group, Inc. (NGS) have strong balance sheets and minimal debt, providing resilience against market volatility [2][16][19][21] Performance Metrics - The Zacks Oil and Gas - Mechanical and Equipment industry has outperformed the broader Zacks Oil - Energy sector, with a 13.5% increase over the past year compared to the sector's 5.8% [9][10] - The industry currently trades at an EV/EBITDA ratio of 7.32X, lower than the S&P 500's 18.31X but higher than the sector's 5.47X [14] Stock Recommendations - NOV has a backlog of $4.56 billion, indicating strong future cash flow generation and a focus on cost reduction [16] - OIS is focusing on profitable offshore and international projects, supported by an increasing backlog and a strong balance sheet [19] - NGS benefits from the rising demand for compression equipment as the U.S. exports more liquefied natural gas (LNG) [21]

Core Viewpoint - Oil States International has announced a dual listing of its common stock on NYSE Texas, while maintaining its primary listing on the New York Stock Exchange, reflecting its commitment to the Texas energy sector [1][2]. Company Overview - Oil States International, Inc. is a global provider of manufactured products and services to the energy, industrial, and military sectors, with headquarters in Houston, Texas [3][4]. - The company was founded in Texas in 1942 and has a long-standing commitment to the Texas economy and energy industry [2]. Recent Developments - The dual listing on NYSE Texas aligns with Oil States' operational presence in Texas, where it has significant operations and personnel [2]. - The company continues to offer technology-differentiated products and services aimed at advancing the production of affordable and reliable energy [2]. Leadership and Operations - Cindy B. Taylor serves as the President and Chief Executive Officer of Oil States International [5][8]. - The company employs approximately 2,000 individuals and has strategically located manufacturing and service facilities worldwide [3][8].

Core Insights - Oil States International, Inc. (OIS) operates in the oil and gas sector, providing services and products for both offshore and onshore operations [1] Financial Performance - For the quarter ending October 31, 2025, OIS reported an EPS of $0.08, which was below the estimated $0.09 and the Zacks Consensus Estimate of $0.10, resulting in a 20% negative surprise [2][6] - The company's revenue for the quarter was $165.18 million, which was 1.4% below the Zacks Consensus Estimate of $167.68 million and represented a 5% decrease from $174.35 million reported in the same quarter last year [3][6] - Operating income for the quarter was $4.7 million, a 10% decline from the previous quarter, but a significant improvement from an operating loss of $11 million in the third quarter of 2024 [4] - Net income was $1.9 million, down 32% from the previous quarter's $2.8 million, yet a notable recovery from a net loss of $14.3 million in the same quarter of the previous year [4] Valuation Metrics - OIS has a price-to-earnings (P/E) ratio of approximately 13.14, indicating the market's valuation of its earnings [5][6] - The company's price-to-sales ratio is about 0.73, suggesting its stock is valued at less than its annual sales [5] - OIS maintains a low debt-to-equity ratio of 0.18, reflecting a conservative approach to debt and supporting its financial stability [5][6]

Financial Performance - For the three months ended September 30, 2025, total revenues were $165,180,000, a decrease of 5.7% compared to $174,348,000 in the same period of 2024[10]. - Product revenues increased to $106,492,000 in Q3 2025, up 5.0% from $100,798,000 in Q3 2024, while service revenues decreased to $58,688,000, down 20.2% from $73,550,000[10]. - The net income for the three months ended September 30, 2025, was $1,900,000, compared to a net loss of $14,349,000 in the same period of 2024, representing a significant turnaround[12]. - Operating income for the nine months ended September 30, 2025, was $15,664,000, compared to an operating loss of $20,173,000 for the same period in 2024[10]. - The company reported a comprehensive income of $600,000 for Q3 2025, compared to a comprehensive loss of $4,782,000 in Q3 2024[12]. - For the nine months ended September 30, 2024, the net loss was $26,422 thousand, compared to a net income of $7,869 thousand for the same period in 2025[19]. - Net income for Q3 2025 was $1.9 million, or $0.03 per share, compared to a net loss of $14.3 million, or $0.23 per share, in Q3 2024[120]. - Consolidated total revenues for the first nine months of 2025 decreased by $37.5 million, or 7%, compared to the first nine months of 2024, reflecting the exit of underperforming service offerings[144]. Assets and Liabilities - Total current assets increased to $511,194,000 as of September 30, 2025, compared to $498,226,000 at the end of 2024, reflecting a growth of 2.0%[15]. - Cash and cash equivalents increased to $67,052,000 as of September 30, 2025, up from $65,363,000 at the end of 2024[15]. - The total liabilities decreased slightly to $323,353,000 as of September 30, 2025, from $324,454,000 at the end of 2024[15]. - The company’s retained earnings increased to $281,529,000 as of September 30, 2025, compared to $273,660,000 at the end of 2024, indicating improved profitability[15]. - The total stockholders' equity decreased from $709,545 thousand on December 31, 2023, to $684,806 thousand by September 30, 2024, reflecting a decline of approximately 3.5%[18]. - As of September 30, 2025, total long-term debt was $1.89 million, a significant decrease from $124.65 million as of December 31, 2024[42]. - The outstanding principal amount of the 2026 Notes was $102.8 million as of September 30, 2025, down from $123.5 million as of December 31, 2024[52]. Cash Flow and Expenditures - Cash flows provided by operating activities for the nine months ended September 30, 2024, were $27,684 thousand, significantly lower than $54,975 thousand for the same period in 2025, indicating a 98.5% increase[19]. - The company reported capital expenditures of $8.71 million for the three months ended September 30, 2025, compared to $7.43 million in the same period of 2024[70][75]. - Capital expenditures totaled $28.2 million in the first nine months of 2025, compared to $23.3 million in the same period of 2024[170]. - During the first nine months of 2025, the company used $39.4 million in financing activities, including repurchasing $20.8 million principal amount of 2026 Notes for $20.3 million and repurchasing 3.2 million shares of common stock for $16.2 million[171]. Revenue Segments - The Offshore Manufactured Products segment generated revenues of $108.63 million for the three months ended September 30, 2025[70]. - The Completion and Production Services segment reported revenues of $27.53 million for the same period[70]. - For the three months ended September 30, 2025, total project-driven revenue was $97,901 thousand, an increase of 7% from $90,918 thousand in the same period of 2024[80]. - For the nine months ended September 30, 2025, total project-driven revenue reached $278,009 thousand, up 7% from $260,064 thousand in 2024[80]. - Revenues from products and services transferred to customers over time accounted for approximately 63% of consolidated revenues for the nine months ended September 30, 2025, compared to 67% in 2024[80]. Market Conditions and Challenges - The average price of Brent crude oil for the third quarter of 2025 was $69.03 per barrel, a decline from $80.01 per barrel in the same quarter of 2024[91]. - The average price of WTI crude oil for the third quarter of 2025 was $65.78 per barrel, down from $76.43 per barrel in the same quarter of 2024[91]. - The company anticipates that ongoing trade conflicts and increased crude oil production by OPEC+ will adversely affect demand for its products and services in the U.S. over the remainder of 2025[94]. - An explosion at a major supplier's facility is expected to disrupt the supply chain for perforating products, potentially affecting production in the latter part of Q4 2025[95]. Compliance and Governance - The company has filed various amendments to its Certificate of Incorporation and Bylaws, ensuring compliance with SEC regulations[3][3.2]. - Certifications from the Chief Executive Officer and Chief Financial Officer were submitted in accordance with the Securities Exchange Act of 1934[31.1][31.2]. - The company is committed to transparency and regulatory compliance through the filing of necessary certifications and reports[32.1][32.2]. - The Executive Vice President and Chief Financial Officer, Lloyd A. Hajdik, has signed the report, affirming its accuracy and completeness[209].

Financial Data and Key Metrics Changes - The company generated revenues of $165 million and adjusted consolidated EBITDA of $21 million in Q3 2025, with net income totaling $2 million or $0.03 per share, which included charges of $4 million related to U.S. land restructuring efforts [11][12] - Cash flow from operations increased to $31 million, a 105% sequential increase, and free cash flow was $23 million [9][12] - The backlog increased to $399 million, the highest level since June 2015, with robust bookings of $145 million, representing a 29% quarter-over-quarter increase [6][12] Business Line Data and Key Metrics Changes - The offshore manufactured products segment generated revenues of $109 million and adjusted segment EBITDA of $22 million, with an adjusted segment EBITDA margin of 21% [11] - The completion and production services segment generated revenues of $28 million and adjusted segment EBITDA of $8 million, achieving an adjusted segment EBITDA margin of 29% [11] - The downhole technologies segment generated revenues of $29 million but reported an adjusted segment EBITDA loss of $1 million due to higher costs from tariffs and lower international activity levels [12] Market Data and Key Metrics Changes - 75% of consolidated revenues were generated from offshore and international projects, reflecting a strategic shift towards longer cycle, higher margin work [6] - U.S. land completion activity declined significantly, with the average U.S. frac spread count down 11% sequentially due to weaker crude oil prices and OPEC Plus's production cuts [7][12] Company Strategy and Development Direction - The company is focused on growing its offshore and international presence while managing volatility in U.S. land activity and driving cash flow generation [10][16] - The strategy includes leveraging cutting-edge technologies and optimizing operations to enhance performance and safety [9][10] - The company anticipates continued strength in future bookings, with a fourth quarter book-to-bill ratio expected to exceed one time [14] Management's Comments on Operating Environment and Future Outlook - Management noted that while U.S. land-based activity may remain subdued into 2026, offshore and international markets are expected to improve due to a growing emphasis on exploration and offshore development [14][42] - The fourth quarter consolidated revenues are expected to increase by 8% to 13% sequentially, with adjusted EBITDA projected to range from $21 million to $22 million [14][54] Other Important Information - The company received two Energy Workforce and Technology Council Safety Awards, highlighting its commitment to health, safety, and environmental improvements [10] - Ongoing deleveraging efforts are expected to unlock additional equity value for stockholders as the company pays off convertible senior notes at maturity in April 2026 [9] Q&A Session Summary Question: Insights on offshore versus U.S. land spending - Management views the trend towards offshore spending as a secular shift, with greater success in deep water and lower break-even costs driving investments [40][42] Question: Impact of tariffs on downhole technologies - Tariffs have significantly impacted the downhole technologies segment, particularly due to increased costs from imported materials, but the completion and production services segment remains less affected [24][27] Question: Margin impacts from U.S. land restructuring - Management expects to see cleaner margins by the end of the year as restructuring efforts conclude, with anticipated EBITDA margins in the high 20s to low 30s for 2024 [33][34] Question: Backlog realization and military awards - Current backlog realization is slightly elongated due to military awards, but future awards are expected to revert to longer-term trends [36] Question: Strategy for U.S. land business - The company is selectively pursuing product lines in the U.S. land market, focusing on those that generate returns and free cash flow [49][50] Question: Fourth quarter guidance and cash flow expectations - Management confirmed expectations for strong fourth quarter cash flow, projecting over $100 million for the year, with significant free cash flow anticipated [52][54]

分组1 - Oil States International (OIS) reported quarterly earnings of $0.08 per share, missing the Zacks Consensus Estimate of $0.10 per share, representing an earnings surprise of -20.00% [1] - The company posted revenues of $165.18 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 1.4%, and down from $174.35 million year-over-year [2] - The stock has increased approximately 34% since the beginning of the year, outperforming the S&P 500's gain of 16% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $0.17 on revenues of $186.1 million, and for the current fiscal year, it is $0.42 on revenues of $678.99 million [7] - The Zacks Industry Rank for Oil and Gas - Mechanical and Equipment is in the top 39% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] 分组3 - The estimate revisions trend for Oil States International was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6]

Financial Performance - Consolidated revenues for Q3 2025 were $165.2 million, a decrease of 5% year-over-year from $174.3 million in Q3 2024[3] - Net income for Q3 2025 was $1.9 million, or $0.03 per share, compared to a net loss of $14.3 million in Q3 2024[5] - Adjusted EBITDA for Q3 2025 was $20.8 million, down 3% from $21.5 million in Q3 2024[3] - Total revenues for the three months ended September 30, 2025, were $165.18 million, a slight decrease from $165.41 million in the previous quarter and a decrease from $174.35 million in the same quarter last year[21] - Net income for the nine months ended September 30, 2025, was $7.87 million, compared to a net loss of $26.42 million for the same period in 2024[25] - Operating income for the three months ended September 30, 2025, was $4.75 million, down from $5.28 million in the previous quarter and a loss of $11.04 million in the same quarter last year[27] - The net income for the three months ended September 30, 2025, was $1.9 million, compared to a net loss of $14.3 million for the same period in 2024[33] - Adjusted EBITDA for the nine months ended September 30, 2025, was $60.6 million, an increase from $58.3 million for the same period in 2024[33] Segment Performance - The Offshore Manufactured Products segment reported revenues of $108.6 million, with a 6% increase year-over-year[7] - The Completion and Production Services segment saw revenues decline to $27.5 million, a 31% decrease year-over-year[9] - Adjusted Segment EBITDA margin for the Offshore Manufactured Products segment improved to 21% in Q3 2025, up from 20% in Q2 2025[7] - The operating loss for the Completion and Production Services segment for the nine months ended September 30, 2025, was $6.3 million, compared to a loss of $19.2 million for the same period in 2024[36] - The Adjusted Segment EBITDA for Offshore Manufactured Products for the three months ended September 30, 2025, was $22.3 million, compared to $23.3 million for the same period in 2024[36] Cash Flow and Capital Expenditures - Cash flows from operations generated in Q3 2025 totaled $31 million, reflecting strong operational performance[6] - For the three months ended September 30, 2025, net cash flows provided by operating activities were $30,685,000, compared to $14,995,000 for the previous quarter[42] - Free cash flow for the three months ended September 30, 2025, was $23,178,000, significantly up from $8,114,000 in the previous quarter[42] - Capital expenditures for the three months ended September 30, 2025, were $8,706,000, down from $10,322,000 in the previous quarter[42] - For the nine months ended September 30, 2025, free cash flow was $40,614,000, an increase from $19,786,000 in the same period of the previous year[42] - The company reported net cash flows provided by operating activities of $54,975,000 for the nine months ended September 30, 2025, compared to $27,684,000 for the same period in 2024[42] - The company’s capital expenditures for the nine months ended September 30, 2025, totaled $28,186,000, compared to $23,309,000 in the previous year[42] Balance Sheet and Assets - Cash and cash equivalents increased to $67.05 million as of September 30, 2025, from $65.36 million at the end of the previous quarter[23] - Total current assets rose to $511.19 million as of September 30, 2025, compared to $498.23 million at the end of 2024[23] - The company reported a total of $281.16 million in current liabilities as of September 30, 2025, an increase from $157.70 million at the end of 2024[23] - The company’s total assets increased to $1.01 billion as of September 30, 2025, compared to $1.00 billion at the end of 2024[23] - The company incurred $20.27 million in purchases of 4.75% convertible senior notes during the nine months ended September 30, 2025[25] - The company’s deferred revenue increased to $73.20 million as of September 30, 2025, compared to $52.40 million at the end of 2024[23] Other Financial Metrics - Corporate operating expenses totaled $9.1 million in Q3 2025, including $0.3 million in severance charges[12] - For the three months ended September 30, 2025, the operating income included $2.7 million in costs related to the consolidation and exit of underperforming service offerings and locations[28] - Adjusted net income, excluding charges and credits, for the three months ended September 30, 2025, was $4.7 million, compared to $2.7 million for the same period in 2024[39] - The company recognized a non-cash goodwill impairment charge of $10.0 million during the nine months ended September 30, 2024[29] - The weighted average number of diluted common shares outstanding for the three months ended September 30, 2025, was 58,016 thousand[39] - The company reported $0.08 adjusted diluted net income per share for the three months ended September 30, 2025, compared to $0.04 for the same period in 2024[39] - The free cash flow metric is not a measure of financial performance under GAAP and should not be considered in isolation from GAAP cash flow measures[42] - The reconciliation of free cash flow to net cash flows provided by operating activities is provided in the financial statements[42]

Company Overview - Oil States International (OIS) is expected to report earnings for the quarter ended September 2025, with a consensus estimate of $0.10 per share, reflecting a year-over-year increase of 150% [3] - Revenues are anticipated to be $167.52 million, which represents a decline of 3.9% compared to the same quarter last year [3] Earnings Expectations - The earnings report is scheduled for release on October 31, and the stock price may increase if the actual results exceed expectations [2] - Conversely, if the results fall short, the stock may decline [2] Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised down by 5.71%, indicating a reassessment by analysts [4] - The Most Accurate Estimate for OIS is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -10.00% [12] Historical Performance - In the last reported quarter, OIS met the expected earnings of $0.09 per share, resulting in no surprise [13] - Over the past four quarters, the company has beaten consensus EPS estimates twice [14] Industry Context - In the broader context of the Zacks Oil and Gas - Mechanical and Equipment industry, Nov Inc. is expected to report earnings of $0.24 per share, reflecting a year-over-year decrease of 27.3% [18] - Nov Inc.'s revenue is projected to be $2.14 billion, down 2.5% from the previous year [18]